How to Talk to Your Clients About Life Insurance

How to Talk to Your Clients About Life Insurance

 In Insurance

Choosing a life insurance policy is a very personal endeavor for most consumers, and one of the hardest to approach for many agents. No one is excited to talk about their death, and there is a lot of misinformation amongst consumers in regards to life insurance. Over half of consumers are unsure benefits from insurance are not taxable, and many don’t believe cash value from permanent life insurance can be used to help fund college educations, supplement retirement income or meet other financial needs.

A life insurance agent needs to believe in the product, be enthusiastic about selling, demonstrate resilience, and be an effective communicator. It can be difficult to sell life insurance to a person who, in all likelihood, won’t see the payoff themselves. It’s essential that agents are able to relay life insurance information in a way in which your prospects not only understand but also see the benefit in purchasing. Here are tips on how to approach insurance with your clients.

Educate Your Customers on Life Insurance

The first stepping in selling life insurance is convincing your prospect that they need what you are selling. If you can’t get someone to believe in the need for life insurance, you won’t make a sale, regardless of the quality of your product pitch. Educating clients and prospects about life insurance is a tremendous opportunity and will go a long way in convincing a prospect that they need your product.

You might have heard the sayings, ‘save for a rainy day,’ or ‘invest for your future,’ both are applicable for selling life insurance. As part of educating your customers it is helpful to get them to think about the future, and what will happen to their family after they have gone. You can start by asking these questions:

  • How will your family support themselves without your income?
  • Will your family suffer financially if they have to pay for your end-of-life arrangements?
  • Will you benefit from the peace of mind that comes with the knowledge that your loved ones will not be burdened?

Understand A Customer’s Motivation

With a variety of life insurance policies available, it is important to understand a customer’s motivation to know which product and sales approach will be most effective. The reason most people purchase life insurance is because they want to take care of their loved ones, or, at a minimum, cover their end-of-life plans for when they pass away. While the motivation for purchase might be fairly universal, there are also many differences of which to be aware. Some customers are motivated by the best value over time, preferring to pay a premium on an annual basis, others will prefer a monthly payment plan that works with their income flow.

Never underestimate, or overestimate, how much a customer knows about life insurance. Communicating clearly and effectively will help you know how to best serve your customer. While some customers will expect their agent to provide a wealth of information and help guide them through the complex decision-making process, others will become overloaded and want their agent to simplify their decision. It is important for agents to recognize what their customer best responds to and adapt accordingly.

Focus on the Future

Deciding on how much life insurance is needed can be more complicated than a person initially realizes. Help your customer brainstorm the less-thought-of-expenses that come along with life insurance. Most people plan to cover the cost of their house, or have a certain monetary figure in mind, but remind them about other expenses they won’t be able to contribute to, such as their spouse’s retirement funds or a child’s future wedding.

Given how tight money is for many people, it can be hard to get customers to think about their future. While nearly 95 percent of people in a recent survey said the ability to save enough to retire comfortably was a top priority when planning for the financial future, a little less than half of those respondents, with a financial professional, have permanent life insurance. The key is to help customers understand how financial decisions they make today will affect their future wealth. Once customers understand the value of long-term investments, they are ready to invest in life insurance.

Confidence plays a large part in an agent’s ability to deliver the right message to the person. Insurance agents need to be able to cater their messages to their audience. ASPECT Management is there to help agents with programs tailored to them. We combine best-of-breed

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Annuities: Take Advantage of Annuities Making a Comeback | ASPECT Management
Take Advantage of Annuities Making a ComebackAnnuities, Insurance
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What Consumers Really Think About InsuranceInsurance

A premium is a monthly fee you pay to have medical insurance coverage. To decide your premium, insurance companies will consider: your age, where you live, whether you smoke or use tobacco and whether the coverage is for one person or a family. Premiums usually go up when the coverage is renewed to reflect your age and higher health care costs.

Final expense life insurance can be used by the beneficiary designated as needed rather than being limited to specific funeral services and providers. Final expense life policies will have a lower face value than most traditional term or whole life policies as they are intended for a specific purpose of covering those final costs rather than providing comprehensive support for surviving family members. This type of policy generally doesn’t require a medical exam, but premiums will be higher the older you are, and some benefit payouts may be limited during the first few years of coverage for those with significant health issues. Reducing or skipping premium payments will impact the amount of interest paid and may impact how long the policy lasts. Accessing the cash value of a policy will reduce the available cash surrender value and the death benefit. Policy guarantees are based upon the claims-paying ability of the issuing life insurance company.

When choosing a life product, make sure that life insurance needs are met long-term, especially if personal situations change — for example, marriage, birth of a child or job promotion. Weigh the costs of the policy, and understand that life insurance, and long-term care coverage linked to life insurance through riders, has fees and charges that vary with sex, health, age and tobacco use. Riders that customize a policy to fit individual needs typically carry an additional charge. The payment of long-term care rider benefits, as an acceleration of the death benefit, will reduce both the death benefit and cash surrender values of the life policy. Additionally, policy loans and withdrawals will also reduce both the cash value and the death benefit. Care should be taken to make sure that life insurance needs continue to be met even if the rider pays out in full, or after money is taken from the life policy. There is no guarantee that a rider will cover the entire cost for all of the insured’s long-term care, as this may vary with the needs of each insured.